Lisa Sheraton, accountant for Chase Home Finance, was injured in a boating accident. Another employee prepared the accompanying income statement for the year ended December 31, 2008.

The individual amounts listed on the income statement are correct. However, some accounts are reported incorrectly, and two items don't belong on the income statement at all. Also, income tax has not been applied to all appropriate figures. The income tax rate on discontinued operations was \(40 \%\). Chase Home Finance issued 52,000 shares of common stock in 2006 and held 2,000 shares as treasury stock during 2008. Retained earnings at December 31, 2007 was \(\$ 167,000\).

Requirement 

Prepare a corrected combined statement of income and retained earnings for 2008 , including earnings per share. Prepare the income statement in single-step format.

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CHASE HOME FINANCE Income Statement Year Ended December 31, 2008 Revenue and gains: Sales Paid-in capital in excess of par-common Total revenues and gains $362,000 90,000 452,000 Expenses and losses: Cost of goods sold $105,000 Selling expenses General expenses Dividends 67,000 61,000 17,000 Sales returns 11,000 Sales discounts 6,000 Income tax expense 20,000 Total expenses and losses Income from operations 287,000 165,000 Other gains and losses: Net income Gain on discontinued operations Earnings per share 5,000 $170,000 S 3.40